Impact of Coronavirus (Covid-19) Pandemic on the Technology Sector

Technology sector has impacted due to the unprecedented crises caused by Covid-19. The tech sector has seen disruption ranging from existing business process to electronics value chain (entities engaged in product designing to product application process) and raw material supply chain, causing an inflationary risk on IT solutions and networking products. The implication of the measures adopted worldwide has significantly boosted the adoption of remote working solutions model, with an aim of evaluating and de-risking the overall value chain. Furthermore, it is anticipated that there will be a significant increase in the capacity requirements and production ramp-ups, as majority of enterprises have allowed their workforce to work remotely, which has led to a rapid increase in the utilization of digital channels during this period.

Amid COVID-19, enterprises in the ICT sector (Information, Communication and Telecom sector) have to make a drastic shift in their spending patterns and have to redesign their short-term and long term business plans.

Short Term Plans (3-5 Months):

  • Revenue shift is expected towards solutions where customer experience and proximity is required
  • ICT spend on security products will increase as enterprise race to secure their end-points, log management, cloud-based tools, and VPNs
  • Hardware companies foresee a significant demand from enterprises for mobile (portable) devices, as they are placing bulk orders to support seamless working of their remote working model

Long Term Initiative (6-12 Months):

  • Cost optimization initiatives via resource optimization or utility models
  • Investment in advanced technologies such as AI/ML models to predict demand under such circumstances (during COVID-19)
  • More investments in software-defined infrastructure in the networking space

Comparative Analysis - 1

Pre-Covid-19 Vs Post Covid-19 - Market Estimates, 2020 – 2021

Technology Sector
Source: Coherent Market Insights

Comparative Analysis - 2

Top Gainers Vs Top Losers

Marginal Growth
  • BPO & ITES Services
High Gainers
  • Security Solutions
  • Cloud Infrastructural Services
  • Tele Conferencing Software
Marginal Loss
  • Banking & Financial Software/Solutions
High Losers
  • Application Development
Source: Coherent Market Insights
Expected recovery : Q1 2021
Coherent Experts Corner
Monica Shevgan
Monica Shevgan

Senior Consultant Level 1
ICT Research

Ameya Thakar
Ameya Thakar

Senior Consultant Level 1
ICT Research


  • Enterprises IT sector need to restructure their resource management and spend on advanced technologies such as analytics, cloud, AI/ML, and robotics used across different end-use industries to maintain agility during this shift. Furthermore, they should focus on the implementation of digital and security solutions in order to ease and secure the new work-process methods aimed at remote working model.

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